Environmental, Social, and Governance Perspectives on Economic Development in Asia: Volume 29B

This chapter aims to examine the comparative economic performance of the United States versus China in the digital era. This chapter uses the Threshold Autoregressive (TAR) model method in comparing economic performance. The US economy was shaken quite significantly in 2008 due to the subprime mortgage crisis. On the other hand, China’s economic performance continues to improve. Based on the estimation results of China’s economic performance which continues to increase with faster economic growth than the United States, it is found that China has resistance to shocks from the 1997 crisis, the 2008 subprime mortgage crisis, and the European debt crisis in 2011 and has the potential to compete with the United States as the dominant country in economic terms. China’s economic growth is getting faster and faster since 1979. It indicates that China’s economy can surpass the US economy, which currently owns the largest gross domestic product (GDP) in the world.

COVID-19 is having a significant impact on the world. Not only attacking the health sector, but the effect of this pandemic is also rooting in all industries. Several states are struggling with an economic recession within several months. Indonesia is one of the countries which experiences the economic downturn shown by the increase in the number of poverties, unemployment, and laid-off workers. While struggling with these issues, both government and Indonesian society should work together to prevent the economic recession. This research aims to capture the impact of social awareness by the community to slow down the pandemic’s effect. Social awareness as a snapshot of the neighborhood reinforcement method (NRM) is used to measure the program’s impact. This research is conducted in a subsidized housing community in Malang. Using structural equation model, this study attempts to measure five different aspects, including (i) economic aspects, (ii) human aspects, (iii) sociocultural aspects, (iv) political aspects, and (v) protection aspects. The result shows a different impact on each element, both positively or negatively.

Research in the field of corporate social responsibility (CSR) has become a trending topic in recent years. Research that is often done is related to CSR disclosure, mostly for large companies. Likewise, the current standards and guidelines ignore micro, small, and medium enterprises (MSMEs). On the other hand, the MSME business sector in the world also impacts the economy, social, and environment, so CSR is needed. CSR activities and reporting cannot be separated from the concept of materiality due to a large amount of leeway in management’s discretion regarding topics and aspects. The purpose of this study is to analyze the issue of MSMEs materiality. The samples collected were 33 MSMEs. The research results show that the material issues for both sectors are similar, which are customer care and satisfaction (profit), employee rights, training and development (people), electricity consumption, and waste management (planet). The concept of materiality is expected to play an important role in MSMEs as a CSR strategy so that MSMEs can apply it to their business practices. Thus, MSMEs pay attention to profit, social, and environment, which is interpreted simply. The management of MSMEs can use this result to formulate CSR’s business strategies and apply them to their business practices. Thus, MSMEs can play a role in sustainability, which is expected to improve financial performance.

Small and medium enterprises (SMEs) are expected to be more creative and innovative to survive in the business competition and to make their businesses environmentally friendly, to develop global supply chain strategies, and to make innovations in products and business processes to become indispensable. This study discusses the effect of green supply chain integration (GSCI) and environmental uncertainty on performance through the moderation of green innovation. Structural equation modeling and maximum likelihood estimation were used to analyze a sample of 130 SMEs in East Java, Indonesia. The result shows that GSCI and environmental uncertainty significantly affect performance, and green innovation significantly moderates the effect. This research found that SME’s performance is influenced by GSCI concept and green innovation application as well as SME’s understanding about recent and future environmental uncertainties; this fits the market demand.

This study has two objectives:(1) to examine impacts of environmental activity, relational marketing, and corporate green image on firm’s competitive performance; and (2) to determine whether relational marketing and corporate green image mediate relationships between environmental activity and firm’s competitive performance. They were data from 375 small and medium enterprises (SMEs) of the food processing industry in Bangkok, Thailand. This study also investigates the relationships between environmental activity, green corporate image, relational marketing, and influences of these factors on firm’s competitive performance. Structural equation modeling (SEM) was used to analyze data. Results reveal significant and positive relationships between environmental activity, green corporate image, relational marketing, and firm’s competitive performance. Moreover, environmental activity, an antecedent variable, indirectly affects a firm’s competitive performance mediated by green corporate image and relational marketing. Therefore, green corporate image and relational marketing can act as mediators between environmental activity and firm’s competitive performance. Findings suggested that firms should focus on improving green corporate image and relational marketing with an appropriate environmental activity strategy to enhance the firm’s competitive performance. Moreover, this study’s result is related to the economics of the environment in terms of cost and benefit. It provides firm’s decision on environmental activity.

Due to the global economic crisis, companies in underdeveloped countries have adopted various effective and efficient internal consolidation strategies to save to survive and grow. However, to continuously grow and achieve various organizational goals, companies also need to be able to unify the perceptions of employees and leaders through the formation of an energetic work mentality and high engagement. Employees have environmental challenges in facing international competition. Besides positive things, negative impacts can occur in job loss, job uncertainty, and anxiety about the ability to compete with other employees scattered around the world. Studies have shown that employees tend to have a sense of attachment to a company when appreciated, supported, and provided with good direction and coordination at work. Therefore, this research aims to determine the effects of perceived organizational support, transformational leadership, and teamwork on employee engagement. It is cross-sectional research with data collected from Indonesian Export Financing Agency employees through questionnaire and tested through hypothesis testing. The result showed that companies need to prioritize increasing employee engagement for sustainability and in order to achieve their various objectives.

Regardless of its relevance for economic development, the influence of strategic orientation by innovation orientation, and strategic marketing by marketing capability on firm performance, this interesting study focused on firms with strategic industries (defense and security) in Indonesia. It approached the gap in three ways. Initially, the examination was conducted on the role of innovation orientation, marketing capability, the interaction of innovation orientation and marketing capability on firm performance. The next step was considering the contribution of state-owned enterprise (SOE) and non-SOE. Finally, this relationship was studied in strategic industries of firms in Indonesia. The firm performance in this study, which we chose, was operational performance. The proposed conceptual model would be tested by distributing questionnaires to 41 firms in Indonesia. This study gave insight into the matters, which should be the companies’ focus, to improve their operations’ performance. By using PLS-based structural equation modeling (SEM) analysis, the results of the relationship between innovation orientation, marketing capability, and the interaction between innovation orientation and marketing capability on operational performance were identified. The findings could be clarified via the variations in the characteristics of enterprises (SOE and non-SOE). Moreover, there were clear variations in the findings, which were recognized among the firms’ relatively different characteristics. The main finding was a challenge to generalize the relationship from strategic orientation and strategic marketing to performance. The results of firm characteristics also had considerable managerial relevance. The authors recommend strategic industries (defense and security) in Indonesia in achieving operational performance excellence. Management’s importance is paying attention to the relationship between innovation orientation, marketing capability, and dynamic capability in running a company organization.

This study seeks to find an interactive effect between ethical leadership (EL) and corporate governance (CG) variables and investigate whether they would affect employee organizational citizenship behavior (EOCB) in a Malaysian organizational setting. The collected data from the 300 accounting/finance department employees were analyzed using Statistical Package for Social Sciences (SPSS) and Partial Least Square–Structural Equation Modeling (PLS-SEM; SmartPLS 3.0). Several primary results confirmed a coherent significant relationship between EL and ethical climate (EC), EL and EOCB, EL and CG, and CG and organizational success. Theoretically, it implies a more enhanced EOCB literature on how it can be infused in an organization. It also offers valuable knowledge by providing organizations with several insights concerning the improvement of EOCB, enabling the organization to achieve its desired success and, more importantly, how the findings could contribute directly and indirectly to emerging markets in terms of their industrial and financial performance.

Entrepreneurship is one of the economic support systems that promote economic growth in Indonesia. Indonesia as a country with good tourism spots has enormous potential to create jobs. The greater the job opportunity, the lower the unemployment. The purpose of this study is to analyze the characteristics of entrepreneurs in the tourism industry in Indonesia. Meanwhile, the method used is a quantitative descriptive approach with logit regression method where four variables are found, namely entrepreneurship, location, gender, and marital status which have a significant positive relationship with the tourism industry. But on the other hand, the location variable also has a significant negative effect on the tourism industry. This study can contribute to government policies to improve Indonesia’s economic development by increasing the productivity of human resources in the tourism industry.

In this study, the taxation knowledge, service, and sanction of the head of village government financial affairs (KAUR of village financial) in Gunung Kidul Regency, Indonesia, were investigated. The data were the primary data obtained by using questionnaires and interview methods. The respondents consisted of 144 of the KAUR of village financial in Gunung Kidul Regency. The sampling data were obtained using a convenience sampling method and then examined by validity test, reliability test, classical assumption test, adjusted R², and t-value test. The obtained questionnaire data showed that the data were valid, reliable, and appropriate to the classical assumption test. The adjusted R² showed a strong correlation of the dependent variable to the independent variable. Furthermore, the t-tested value results showed that the KAUR of village financial in Gunung Kidul Regency fully understood the responsibility of the taxation knowledge, services, and sanctions.

The study provides medium-term estimates of recovery paths for Indian economy using a dynamic factor (DF)-based approach that employs data on high-frequency indicators à la Bhadury, Ghosh, and Kumar (2020). The DFs are used to analyze the post-pandemic recovery and convergence with its pre-COVID-19 trend for India between March 2021 and March 2022. A broad sectoral assessment of the impact of COVID-19 is also conducted. In addition, forward-looking measures based on stock returns are used to analyze the transmission of additional banking sector risks to the real sectors by constructing daily delta conditional value-at-risk (CoVaR) estimates. Our estimates based on the DFs suggest that the aggregate economic activities may catch up to the estimated pre-COVID trend by March 2021 predominantly driven by the growth in services sector. The industrial sector and consumer goods sector continue to show moderate signs of recovery. Our CoVaR estimates corroborate these findings. Banking sector transmission risk is among the lowest for services such as healthcare and information technology (IT), for both the lockdown period between March 25 and June 8, 2020, and for the latter months. The transmission risk continues to remain high for metal, oil and gas, and capital goods sector. Broadly, the evidence on forward-looking banking sector risk transmission for major sectors is in alignment with our finding on their recovery based on DF models, after easing of COVID-19 lockdown.

Electronic word of mouth (eWOM) is a digital marketing method that has been considered by some companies as an effective and efficient approach to enhance social learning and the environment for the customers. A social media user could benefit from gaining information from other users to aid their decision-making process. Instagram is an example of a social media platform that could be utilized for the application of eWOM. It could serve as a source of quality, credible and detailed information, and a channel to increase customer interactions and trust. This study aims to determine the effects of eWOM information generated through Instagram on patients’ intention to join the in vitro fertilization (IVF) programs. By adopting the information acceptance model (IACM) theory, several parameters were evaluated: information quality, credibility, usefulness, adoption, attitude toward information, and purchase intention. The structural equation modeling (SEM) was used to analyze as many as 200 respondents of Morula IVF Jakarta and were active Instagram users. The results showed that the adoption of information and attitude toward information had considerably influenced patients’ intentions to join the IVF programs. Such circumstances might have occurred as a result of the increase in information exchange about IVF, through the discussions and sharing of experiences by patients on Instagram. Furthermore, information usefulness was demonstrated to affect information adoption and was influenced by the credibility of information and attitudes toward information. Nonetheless, one variable which did not display any effects on the usefulness of information was the quality of information. In summary, the characteristics of eWOM information that were conveyed on Instagram could affect the intention of patients in joining the IVF program.

This study aimed to obtain the study results of the visit increase model by adding the word of mouth (WOM) variable based on the results of research reviews in 2017 and 2019. The research was conducted in the ecotourism area of the south coast of West Java, which is oriented toward the environment’s carrying capacity and improving the community’s economy. Data analysis used descriptive verification using structural equation modeling (SEM), with a total of 302 respondents. The study results obtained descriptive analysis results based on research in 2017 and 2019, which showed no different results. The descriptive analysis results show that tourist travel motivation is considered strong by tourists; tourists have felt impressive tourism experiences. The average image of tourism destinations is considered sufficient. The West Java ecotourism area is quite successful in becoming a positive WOM conversation among most tourists. The intention to revisit is considered insufficient, or tourists have not agreed to return soon. The results of the verification analysis show that all the proposed hypotheses have a significant effect so that the model of increasing tourist visits based on travel motivation and impressive tourism experiences, the destination image that is intermediated by the WOM variable, has an impact on revisiting intention.